Additional Funds Added to Paycheck Protection Program in New Bill Passed by Congress

The U.S. Congress passed an additional stimulus bill on April 23, 2020. The new bill expands funding for small business as well as additional funding for hospitals and COVID-19 testing. The bill was in response to the exhaustion of the money allocated for the SBA’s Paycheck Protection Program created by the Coronavirus Aid, Relief and Economic Security Act (the “CARES Act”) passed last month and the money allocated to the SBA’s Economic Injury Disaster Loan program.

The new bill creates an estimated $310 billion in new funds allocated for the Paycheck Protection Program. Additionally, there are specific carveouts for smaller “mom & pop shops” who expressed frustration with the program after being unable to obtain these loans over larger organization who had stronger relationships with financial institutions. Smaller lenders will also be allocated certain amounts of these funds, with $60 billion set aside for lenders who have less than $50 billion in assets and $30 billion set aside for lenders with less than $10 billion in assets. These specific carveouts should help small, midsize and other community lenders get funds to organizations in communities who may have difficulty obtaining these loans. However, these carveouts may create even more delays in the SBA’s application process, something which many users have already expressed having trouble with. The new bill also allocates an additional $60 billion to the SBA’s Economic Injury Disaster Loan Program.

If you have not filed for a PPP loan or an EIDL loan, check out the Crow Legal COVID-19 Resource Page for information on how to apply.